This review focuses on children's physiological responses to out-of-home childcare. The finding that children's cortisol levels are higher at childcare than at home has been well-replicated. Here we summarize recent evidence examining possible correlates of elevated cortisol levels. Reviewed studies suggest that childcare quality matters, whereas group sizes and type of care do not. As for child characteristics, elevated cortisol at childcare is more pronounced in toddlers than in infants, and in inhibited and aggressive children. We discuss recent advances focusing on hair cortisol analysis and immunomarkers of stress, and suggest that there is a need for experimental and longitudinal studies to examine causal relations and possible negative long-term consequences for children's health and development.